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FM AMEMBASSY STOCKHOLM
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4488
INFO RUCNAFG/AFGHANISTAN COLLECTIVE IMMEDIATE
RUEHZL/EUROPEAN POLITICAL COLLECTIVE IMMEDIATE
RUCNIRA/IRAN COLLECTIVE IMMEDIATE

C O N F I D E N T I A L SECTION 01 OF 06 STOCKHOLM 000418 
 
SIPDIS 
 
E.O. 12958: DECL: 07/09/2029 
TAGS: EUN PREL PGOV IR RS SW
SUBJECT: EUR A/S GORDON'S JULY 3 MEETINGS WITH THE EU 
POLITICAL DIRECTORS 
 
STOCKHOLM 00000418  001.2 OF 006 
 
 
Classified By: CDA LAURA J. KIRKCONNELL FOR REASONS 1.4(B) AND (D) 
 
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SUMMARY 
------- 
 
¶1. (U) Assistant Secretary for European and Eurasian Affairs 
Phil Gordon met with the 27 EU Member State Political 
Directors in Stockholm July 3.  He then met with the EU 
Political Directors "troika," comprising Swedish PolDir Bjorn 
Lyrvall, EU Council Secretariat DG Robert Cooper, EU External 
Relations Commission PolDir Karel Kovanda, Spanish PolDir 
Alfonso Lucini, and EU Council Secretariat Policy Coordinator 
Helga Schmid. 
 
¶2. (C) On Iran, A/S Gordon emphasized that post-election 
developments have not altered the Obama Administration's 
fundamental approach to the nuclear question, and UK PolDir 
Mark Lyall-Grant urged the EU to be in position "to move 
rapidly" with new sanctions at the beginning of the Spanish 
EU Presidency in January 2010.   On the Middle East peace 
process, the United States was focused on creating the 
conditions necessary for peace before proposing full-scale 
negotiations.  This would require a stop to Israeli 
settlements and efforts to build up Palestinian security 
capacity and an end to violence and incitement.  French 
PolDir Gerard Araud raised the possibility of an EU security 
force in support of a possible agreement.  Regarding the 
U.S.-Russia relationship, Gordon said that the Russians are 
testing the Obama Administration to see if it will compromise 
on its principles; it won,t. 
 
---- 
IRAN 
---- 
 
¶3. (C) Swedish MFA Political Director Bjorn Lyrvall opened 
A/S Gordon's discussion with the EU 27 PolDirs by noting 
growing concern over internal developments in Iran following 
last month's presidential elections.  Terming as "outrageous" 
regime statements blaming the unrest on foreign actors, 
Lyrvall discussed the importance of EU unity in response to 
the detention of local employees of the British embassy in 
Tehran and noted that the EU Political Directors had 
discussed "possible responses" to the detentions during their 
meetings earlier in the day.  Asked to brief on the nuclear 
file, EU DG for External and Politico-Military Affairs Robert 
Cooper replied that he had little to say.  The post-election 
unrest in Iran seemed to entail "no new cooperation, perhaps 
rather less," and the Iranian regime was now weaker and less 
legitimate.  Cooper continued that "the prospects look 
difficult" for a meaningful Iranian response to the P5 1 
offer, and that we had always seen this year as the key year 
for addressing this issue. Cooper concluded that, in the 
second half of this year, we must have "the beginning of a 
breakthrough." 
 
¶4. (C) In his introduction, A/S Gordon expressed the 
importance the Obama Administration attaches to working with 
Europe, stressing that the U.S. realizes that it cannot 
handle matters alone and that Europe is our most natural 
foreign policy partner.  Concerning Iranian election unrest, 
he said that the Administration's policy had denied the 
regime the opportunity to blame the U.S. so now it was 
turning to the UK.  Asked about links between the 
post-election domestic situation and the negotiations on the 
nuclear file, A/S Gordon suggested that the regime might 
pursue one of several options.  It might decide to engage the 
P5 1, which A/S Gordon (and other EU PolDirs) assessed as 
unlikely.  Or it could pretend to engage, while forestalling 
meaningful action.  Lastly, it could refuse any dialogue. 
 
¶5. (C) While now is not the time for the USG to increase its 
engagement, it is also not the time to reduce it, Gordon 
continued.  The President's approach would continue to 
highlight the path Iran would need to take to address 
international concerns.  But the clock was ticking as long as 
enrichment continued, Gordon added, so he urged the PolDirs 
to start thinking now about actions they might need to take 
by the end of the year to increase pressure on Tehran.  "Each 
day that passes sharpens the binary choice between accepting 
a nuclear Iran or a military strike, either by Israel or the 
U.S.," Gordon continued.  The successful development of a 
nuclear capability by Iran would spell the death of the 
Non-Proliferation Treaty, he concluded, because the 
international community would not be able to maintain 
credibility with other would-be nuclear powers. 
 
¶6. (C) UK Political Director Lyall-Grant agreed that the 
prospects for negotiations with Iran were not good, but 
 
STOCKHOLM 00000418  002.4 OF 006 
 
 
argued that the P5 1 must persevere "because the alternatives 
are grim."  If talks do not yield progress soon, then the EU 
must "discreetly" think about additional sanctions even in 
the absence of a UN Security Council resolution, which would 
be unlikely given the Russian and Chinese positions.  The EU 
should be in position "to move rapidly" at the beginning of 
the Spanish EU Presidency (in January 2010) with a set of 
sanctions that are "very substantive" in the areas of "trade, 
banking and possibly the hydrocarbons sector."  He also 
expressed gratitude for U.S. and EU solidarity with the UK 
concerning its local embassy employees in Tehran. 
 
¶7. (C) Iran was turning into "a military dictatorship with an 
extremist ideology," stated German Political Director Volker 
Stanzel.  Therefore, the international community must not 
"play the game the Iranian leaders want" and must not 
escalate in response to Iranian escalations. Rather, 
engagement with the Iranian opposition should continue where 
possible.  Moreover, the international community should press 
Tehran for a "yes/no" answer to the P5 1 proposal by the time 
of the UN General Assembly in September.  Efforts to keep 
Russia and China "in the boat" would be important, but even 
without them the EU and United States should "go ahead 
anyway" with additional autonomous sanctions. 
 
¶8. (C) Spanish PolDir Alfonso Lucini noted "consensus that we 
need to prepare a Plan B," but asked whether enhanced 
sanctions would "be enough" if Russia and China were not on 
board.  Saying he preferred further UNSC action on Iran, A/S 
Gordon acknowledged that PRC leaders' concerns regarding 
China's internal stability*which requires sufficient oil 
imports to maintain economic growth*was a key factor in PRC 
policy on Iran.  And while Russia did not want to see a 
nuclear Iran, it might also be motivated by a desire to 
ensure that the United States and the EU do not enjoy a major 
foreign policy success in the Middle East.  Indeed, some in 
Moscow might see advantages for Russia if Israel or the 
United States used force against Iran, which in their view 
would seriously damage U.S. standing in the region, as well 
as dramatically increase the price of oil.  Even if Russia 
and China refused to support a new UNSC, joint U.S.-EU 
actions would have a powerful impact on trade -- and be a 
powerful statement with respect to regime legitimacy.  And if 
there were no new effort on sanctions, that failure to act 
would send a message to the rest of the world about the low 
risk of pursuing a nuclear program. 
 
------------------------- 
MIDDLE EAST PEACE PROCESS 
------------------------- 
 
¶9. (C) Turning to the Middle East peace process, A/S Gordon 
noted that after extensive consultations in the region, 
Special Envoy Mitchell had concluded the time was not ripe 
for full-scale negotiations between the Israelis and 
Palestinians.  Rather, the conditions for successful 
negotiations needed to be created first.  The United States 
had "visibly and publicly" called for Israel to halt all 
settlement activity, which helped create an atmosphere in 
which we could ask that Arabs do hard things as well. S/E 
Mitchell has been urging Arab governments to support the 
Palestinian Authority's security services in an effort to 
enhance security in the West Bank and Gaza.  The U.S. saw no 
logic to engagement with Hamas until it renounces violence 
and recognizes all past agreements, A/S Gordon continued. 
While the U.S. and EU both need to remain engaged with both 
the Israelis and the Palestinians, there might be benefits in 
Washington focusing its efforts on getting a stop to 
settlement activity while the EU focused on efforts to build 
security in the PA-administered territories. 
 
¶10. (C) Lyrvall said the EU very much welcomed the U.S. 
approach and the President's Cairo speech.  The gap between 
the Israelis and Palestinians is very deep.  Greek PolDir 
Tryphon Paraskevopoulos stated that "no one in the Middle 
East thinks Iran will actually use nuclear weapons against 
Israel."  Rather, they think Israeli concerns over the 
Iranian nuclear program are motivated by a desire to not lose 
their strategic dominance.  He noted that whenever the 
international community took actions against Iran, Iran 
responded by firing up Hamas and Hizbullah to cause trouble. 
A regional approach, therefore, was needed, including 
improved ties with Syria.  The Greek PolDir concluded 
elliptically that Qatar and Saudi Arabia needed to "stop 
playing with fire."  A/S Gordon noted that Syria is the 
conduit for Iranian arms into the region, and that U.S. 
diplomacy is focused on weaning Syria away from Iran. 
 
¶11. (C) French PolDir Araud said that we should not get into 
any prolonged negotiations with the Israelis on settlements; 
 
STOCKHOLM 00000418  003.2 OF 006 
 
 
the core issue is negotiations between the Israelis and 
Palestinians.  The Knesset is unable to act.  We already know 
the parameters of the peace agreement.  If there is no strong 
international commitment to working this, the parties will 
not negotiate, he said.  Nothing will be possible if the 
U.S., the EU, and the Arab states are not united in pressing 
both sides.  He also raised the possibility of an EU security 
force in support of a possible agreement.  A/S Gordon agreed 
with Araud on settlements, but said that we need to improve 
the context for real negotiations by making progress on 
smaller issues, and that the U.S. call for stopping 
settlements resonates with the Arabs, and helps with asking 
them for funding for the PA and reaching out to Israel. 
 
-------------------- 
AFGHANISTAN/PAKISTAN 
-------------------- 
 
¶12. (SBU) A/S Gordon outlined the significant steps the Obama 
Administration was taking in Afghanistan:  21,000 additional 
troops, the appointments of SR Holbrooke, LTG McChrystal, 
Amb. Eikenberry, as well as certain changes in strategy such 
as on narcotics.  He asked that European governments do more 
to explain to their publics that the EU is not helping the 
Americans with "an American war."  Afghanistan and Pakistan 
are global problems with serious security and humanitarian 
concerns for Europe.  Lyrvall agreed, pointing to ongoing 
discussions within the EU on doing more on the civilian side, 
and noting that the upcoming Afghan elections were crucial. 
European Commission PolDir Kovanda stated that the EU will 
deploy 250 observers from Member States, PRTs and local 
missions to monitor the elections along with 8,000 Afghan 
observers, and expressed gratitude for NATO,s indispensable 
in extremis support. 
 
------ 
RUSSIA 
------ 
 
¶13. (C) At Lyrvall's request, A/S Gordon offered some 
impressions to the group on U.S. relations with Russia.  He 
said that we are looking to restore relations while also 
stressing our core principles; e.g., no spheres of influence, 
democracies have the right to choose alliances, and 
non-recognition of Abkhazia and South Ossetia.  The Russians, 
for their part, are exploring U.S. willingness to compromise 
in the name of better relations, which we will not do.  A/S 
Gordon said that with regard to the Medvedev proposals, the 
U.S. is not prepared to compromise on European security. 
Lyrvall asked about expectations for the Moscow Summit.  A/S 
Gordon said we were not trying to overstate expectations, but 
we are talking seriously with the Russians on arms control 
and Afghanistan.  Lithuanian PolDir Eitvydas Bajarunas urged 
a common U.S.-EU approach on Belarus and Georgia, and A/S 
Gordon replied that we can only interpret the Zeltser release 
as an expression of Belarus's interest in better relations, 
and that he was planning to go to Belarus himself.  He said 
Georgia was a good example of the U.S. not compromising its 
principles in the name of better relations with Moscow-- in 
fact, Russia had been isolated on decisions regarding OSCE 
and UNOMIG ) and he noted the Vice President's upcoming trip 
to Georgia and Ukraine. 
 
-------------- 
TROIKA MEETING 
-------------- 
 
¶14. (U) After his meeting with EU27 PolDirs, Gordon held a 
smaller meeting with the EU Political Directors "troika," 
comprising Swedish PolDir Bjorn Lyrvall, EU Council 
Secretariat DG Robert Cooper, EU External Relations 
Commission PolDir Karel Kovanda Kovanda, Spanish PolDir 
Alfonso Lucini, and EU Council Secretariat Policy Coordinator 
Helga Schmid. This smaller discussion focused on Russia, the 
Eastern Partnership region, the Western Balkans, and 
non-proliferation. 
 
------ 
RUSSIA 
------ 
 
¶15. (C) A/S Gordon conveyed that the U.S. may be making some 
progress with Russia on START follow-on negotiations, and may 
also be making progress with regard to cooperation on 
Afghanistan.  We have little to no progress to report 
regarding Georgia.  The Russians are testing the Obama 
Administration to see if it will compromise; it will not. 
Lyrvall commented that there have been no breakthroughs in 
EU-Russia Partnership and Cooperation Agreement (PCA) 
negotiations, and noted that the Russians see the EU's 
 
STOCKHOLM 00000418  004.2 OF 006 
 
 
Eastern Partnership initiative through a zero-sum lens; if it 
encourages closer EU ties with six former-Soviet states, it 
must be anti-Russia.  Lucini recommended engaging Russia in 
the Eastern Partnership through cooperation on concrete 
projects.  Helga Schmid praised the OSCE Ministerial in Corfu 
for its emphasis on the indivisibility of Euro-Atlantic 
security. 
 
------- 
GEORGIA 
------- 
 
¶16. (C) Schmid commented that the Geneva process is useful 
because it is the only venue which includes all parties to 
the Georgia conflict.  She encouraged the U.S. to press 
Georgia to work with the Abkhaz; the Abkhaz have been 
rebuffed in their overtures to the Georgians, and are left 
with no option but to seek Russia's support.  Kovanda 
similarly urged outreach to the Abkhaz; they are looking for 
some daylight with the Russians, and we should help.  EU 
negotiations on visa facilitation with Georgia are not going 
well.  Lucini said we need to let Georgians know we support 
them without giving Saakashvili "a blank check." 
 
¶17. (C) A/S Gordon said the Georgians have shown reasonable 
restraint with protesters lately, marking a departure from 
previous behavior.  Vice President Biden's upcoming trip to 
Georgia will emphasize the need to strengthen democratic 
institutions.  A/S Gordon inquired about potential U.S. 
participation in the EU's Georgia monitoring mission.  An 
American contribution*either official USG or via NGOs--would 
showcase our commitment, and could potentially deter future 
Russian misbehavior.  Schmid noted that U.S. participation 
would also mean opening the mission to Turkey and Ukraine; 
U.S. political support might be preferable.  Cooper agreed 
that it would be hard for the EU to resist Turkish 
participation in the EU monitoring mission if the U.S. 
participated, as Turkey is an EU candidate country.  Turkish 
participation would not necessarily be a bad thing, but it 
would "need some thinking about." 
 
------- 
BELARUS 
------- 
 
¶18. (C) Schmid said the Belarusians are under huge pressure 
from Russia to recognize Abkhazia and South Ossetia; the 
Belarusian FM told her so personally at Corfu.  Belarus is 
bankrupt, and therefore vulnerable to Russian exploitation. 
The EU is looking into possible European Bank for 
Reconstruction and Development and IMF support, on the order 
of two to three billion dollars.  Schmid said "I don't like 
Luka, but(" the Zeltser release was clearly intended as a 
signal. 
 
------------------- 
EASTERN PARTNERSHIP 
------------------- 
 
¶19. (C) A/S Gordon said the U.S. understands this; we would 
like to associate ourselves with the EU's Eastern Partnership 
initiative.  Lyrvall said an EU-Ukraine FTA is looking 
increasingly unlikely due to Ukrainian squabbling; Moldova is 
likewise "a mess."  It is difficult to anchor those countries 
into the European integration process.  On Armenia, A/S 
Gordon said that resolving Nagorno-Karabakh is the key to 
unlocking Turkish-Armenian relations, and consequently 
regional energy supplies.  The Russians have been reasonably 
productive on this account, but it is unclear whether they 
are just going through the motions or are seriously engaged, 
particularly as a Nagorno-Karabakh solution would facilitate 
a Southern Corridor gas route.  Cooper asserted that if the 
Russians really wanted to resolve Nagorno-Karabakh, they 
would have done so already.  On Ukraine, A/S Gordon asserted 
that the U.S. does not want to unconditionally bail Ukraine 
out of its economic troubles.  We should let IFIs 
(particularly the IMF) help Ukraine.  The U.S. and EU need to 
urge Ukraine's unwilling government to take difficult steps 
in this regard. 
 
--------------- 
WESTERN BALKANS 
--------------- 
 
¶20. (C) Pointing to EU High Representative Solana/Vice 
President Biden's and Swedish FM Bildt/Deputy Secretary 
Steinberg's recent joint engagement in the Balkans, A/S 
Gordon said the more high-level U.S.-EU cooperation we can 
organize in the Balkans, the better.  Lyrvall said that 
Sweden wants to keep the EU's enlargement agenda moving 
 
STOCKHOLM 00000418  005.2 OF 006 
 
 
during the Swedish Presidency.  Montenegro's application is 
with the Commission, and Macedonia may receive a relatively 
positive EU progress assessment.  Fairly or unfairly, 
Macedonia may have to compromise on the name issue in order 
to move forward on EU accession.  In Serbia, implementation 
of the interim agreement is "deadlocked," and Dutch FM 
Verhagen's recent trip to Serbia is unlikely to assuage the 
Netherlands' concerns. 
 
¶21. (C) On Bosnia and Herzegovina, FM Bildt and Deputy 
Secretary Steinberg planned to meet the following week to 
discuss the Prud process.  It is critical that BiH takes 
ownership of the 5 2 process, Lyrvall said.  The EU is 
enthusiastic about a transition in BiH as long as the 
conditions are met.  There has to be recognition that the 
EUSR mission would be less "intrusive"; rather, the EU would 
present a "pull factor" for reform, he added.  EU enlargement 
policy has been a successful incentive for reform elsewhere 
in the region.  A significant shift in the Althea mission 
should not take place until transition is secure on the 
civilian side, Lyrvall concluded. Cooper said there might 
come a point where we need to "force the issue" of state 
property; if we do not resolve this before the autumn PIC, 
then we'll lose two years because of the Bosnian elections. 
Cooper added that after a "miserable" PIC, we should insist 
on conditionality.  BiH Croats have gotten the message from 
Zagreb to be productive. 
 
¶22. (C) A/S Gordon asked whether the Swedes might invite the 
parties and the U.S. to Stockholm to resolve the state 
property issue.  The U.S. agrees that OHR is not doing well, 
but we are reluctant to take away the crutch and make a leap 
of faith.  He recounted a side conversation with French 
PolDir Gerard Araud, who said that if we wean the Bosnians 
off of the "drug" of OHR, then the EU can be the "methadone." 
 Furthermore, to conduct a military transition at the same 
time as the OHR/EU transition would send the wrong signal and 
might invite problems.  Lucini said EU member states are 
talking to their militaries about the need to stay in BiH, 
but militaries are pushing back.  Lyrvall conceded the need 
for "a comfort blanket." 
 
¶23. (C) On Macedonia, A/S Gordon said the U.S. is still 
letting UNSR Nimetz lead, and noted that Deputy Secretary 
Steinberg has talked to the Greeks.  While the Macedonians 
need to "climb down" on issues such as naming their airport, 
they have a reasonable case on other topics such as their 
language, the name of their citizenship, etc.  Some "climbing 
down" is needed on both sides. 
 
¶24. (C) On Serbia, A/S Gordon said that while we haven't 
spoken to ICTY prosecutor Brammertz, the U.S. is trying to 
provide further FBI and forensic assistance.  The U.S. is 
trying to determine what Serbian steps are required in order 
to get the Dutch on board with Serbia's EU accession process. 
 What is the gap between "full Serbian cooperation" and what 
the Serbs are currently doing, and how can it be filled? 
Cooper said we are caught in a vicious circle with Brammertz, 
who feels he cannot utter the words "full cooperation" but is 
trying to indicate as much in other terms. 
 
¶25. (C) On Kosovo, Lyrvall noted the sensitivities raised by 
the fact that five EU member states do not recognize Kosovo's 
independence.  However, even these recalcitrant member states 
would like to move forward with Kosovo's Euro-Atlantic 
integration.  Lyrvall noted the issue of visa liberalization 
in the Balkans, and said the EU has leverage on the Serbs in 
this regard.  Cooper stated that we have had some small 
successes in Kosovo and some failures.  The Battle of Kosovo 
Polje anniversary passed without incident, with the Serbian 
royal family making some usefully anodyne speeches.  But 
decentralization in Kosovo will not succeed.  Serbian 
President Tadic has said that Serbia cannot call on Kosovo 
Serbs to vote in Kosovo,s elections.  EUSR for Kosovo Pieter 
Feith thought we should think of 2011 as a deadline for 
bringing the ICO process to an end:  according to Feith, once 
a state is up and running, the international community should 
step back.  The "six point" agenda is largely dead.  A/S 
Gordon relayed that Deputy Secretary Steinberg told Kosovo 
leaders that their comments on UNMIK were not helpful. 
 
----------------- 
NON-PROLIFERATION 
----------------- 
 
¶26. (C) Lyrvall said that the EU was very encouraged by the 
Obama Administration's approach on non-proliferation.  A/S 
Gordon said that the Administration is serious about the goal 
of a world free of nuclear weapons, but realistic.  If the 
international community hopes to promote a Fissile Material 
 
STOCKHOLM 00000418  006.2 OF 006 
 
 
Cut-off Treaty and create an international nuclear fuel bank, 
we must back the  IAEA with resources.  The Administration 
will try to get the Comprehensive Test Ban Treaty ratified; 
the prospects for ratification are uncertain, but are better 
now than before, in part due to improvements in scientific 
modeling over the past ten years.  Regarding START talks with 
Russia, the Administration seeks a framework that permits 
fewer weapons than the Moscow Treaty and that also includes 
delivery vehicles and warheads.  Both sides want an 
agreement, but ratification is always a question.  Raising 
Iran, Cooper pointed out that a nuclear-armed Iran would 
"blow the NPT out of the water."  If we allow Iran to develop 
the bomb, how can we credibly say "no" to the Egyptians and 
the Saudis? 
 
¶27. (U) Assistant Secretary Gordon has cleared this cable. 
KIRKCONNELL